The Arizona state senate concurred with the house on Senate Bill by a vote of 18-0, sending the legislation to Governor Jan Brewer’s desk for a signature. SB1439, the Constitutional Tender Act, allows businesses and the state government to accept payments in gold or silver. It specifies that legal tender in Arizona consists of all of the following:

Legal Tender authorized by Congress.

Specie (containing gold or silver) coin issued at any time by the U.S. government.

Any other specie that a court of competent jurisdiction rules by a final, unappealable order to be within the scope of state authority to make legal tender.

The bill previously passed the state senate by a vote of 17-11. Since there was a House amendment which tightened up some of the language, constitutionally, the bill needed one final vote on the floor of the State Senate before going to Jan Brewer’s desk for a signature.

BACKGROUND INFORMATION

Currently all debts and taxes in Arizona and the rest of the United States are either paid with Federal Reserve Notes (dollars) which were authorized as legal tender by Congress, or with coins issued by the U.S. Treasury — very few of which have gold or silver in them.

The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” The Constitutional tender act is a big step towards that constitutional requirement which has been ignored for a long time in every state of the country. Such a tactic would achieve the desired goal of abolishing the Federal Reserve system by attacking it from the bottom up – pulling the rug out from under it by working to make its functions irrelevant at the State and local level.

Over time, as residents of the State use both Federal Reserve Notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve Notes do will lead to a “reverse Gresham’s Law” effect, where good money (gold and silver coins) will drive out bad money (Federal Reserve Notes). As this happens, a cascade of events can begin to occur, including the flow of real wealth toward the State’s treasury, an influx of banking business from outside of the State – as people in other States carry out their desire to bank with sound money – and an eventual outcry against the use of Federal Reserve Notes for any transactions.

Once things get to that point, Federal Reserve notes would become largely unwanted and irrelevant for ordinary people. Nullifying the Fed on a state by state level is what will get us there.

Without a single act of Congress, the Federal Reserve system can be brought to its knees by passing such bills in states all over the country.

HOUSE AMENDMENT

The amendment passed by the house makes two technical revisions to the bill on the same Constitutional principle. They are as follows:

1. Strike “and taxes” from line 11 – ”LEGAL TENDER” MEANS AN AUTHORIZED MEDIUM OF EXCHANGE FOR THE PAYMENT OF DEBTS AND TAXES.

This part of the amendment is constitutionally-sound. It makes sure the bill is in line with Article 1, Section 10 of the Constitution, which makes reference to debts, but not taxes. It reads, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.”

2. Strike line 25-26: B. ANY TAX THAT IS DUE AS A CONSEQUENCE OF A TRANSACTION THAT INVOLVES SPECIE LEGAL TENDER SHALL BE PAID PROPORTIONATELY IN THE SAME LEGAL TENDER.

The is constitutionally-sound for the same reason as above. Taxes, however, can be debts, so at best, this text was redundant.

ACTION ITEMS for Arizona

1. Contact Governor Brewer. Strongly, but politely, let her know that you want her to SIGN SB1439 into law. It is strongly recommended that you CALL rather than email.

(602) 542-4331
800-253-0883 (outside Maricopa County only)

2. Share this information widely. Please pass this along to your friends and family. Also share it with any and all grassroots groups you’re in contact with around the state. Please encourage them to email this information to their members and supporters.